The Securities and Exchange Board of India (Sebi) has imposed penalties on Suzlon Energy and several of its executives, alleging that the company used a series of intra-group transactions to present a misleading picture of its finances.
In a 96-page order issued on Friday, the market regulator said Suzlon structured transactions between its subsidiaries in a manner that artificially inflated profits, net worth and investor perception, even though the dealings lacked genuine economic substance.
Girish Tanti, a non-executive director during the investigation period, was fined ₹5.75 crore and Vinod Tanti was penalized with ₹5.45 crore. Kirti J. Vagadia, who was the company’s chief financial officer in 2015-2016 was fined ₹1.5 crore and Amit Agarwal was fined ₹30 lakh. Suzlon Energy was fined ₹15.95 crore.
The investigation period was from FY14-15 to FY19-20 and the first three quarters of FY20-21. The order kept aside an adjudication order passed in 2025 which favored Suzlon.
“In the present case, the revision proceedings have been initiated, inter alia, on the ground that the adjudication order dated June 27, 2025 has not adequately examined material aspects arising from the investigation record and has confined its analysis largely to procedural considerations such as valuation reports, approvals and disclosures,” said Sebi in the order.
OMS deal and alleged round-tripping
At the centre of the case was Suzlon’s 2014 sale of its operations and maintenance services (OMS) business to subsidiary Suzlon Global Services Ltd (SGSL) for ₹2,000 crore. The transaction allowed Suzlon to book a profit of nearly ₹1,923 crore and inflated its net worth to ₹2,663.96 crore instead of ₹741.04 crore, sharply improving its reported financial position.
Girish Tanti, a non-executive director during the investigation period, was fined ₹5.45 crore and Vinod Tanti was penalized with ₹5.75 crore.
Sebi, however, alleged that SGSL did not have the financial capacity to pay ₹2000 crore and that only about ₹700 crore was actually received by Suzlon over three financial years. According to the regulator, the remaining amount was allegedly routed through a series of circular fund transfers
The regulator described these as “round tripping” and “circuitous entries”, arguing that no real external cash entered the group despite the appearance of large repayments in the books.
Other transactions under scrutiny
The market regulator also flagged another transaction in which Suzlon later transferred its stake in SGSL to another subsidiary, Suzlon Structures Ltd, and booked an additional gain of about ₹830 crore. According to the regulator, the company effectively generated profits twice from the same underlying OMS assets.
The order also examined transactions involving subsidiaries SE Forge Ltd and Suzlon Gujarat Wind Park Ltd (SGWPL). In the SGWPL matter, Sebi alleged that ₹1,200 crore moved repeatedly through multiple entries on a single day to create the appearance of equity infusions and repayments, without corresponding economic value creation.
“The financial statements and disclosures of a listed entity are alleged and found to be misleading, the role of those who were associated with the relevant transactions, financial reporting process, certification framework, or senior management responsibility during the relevant period has to be assessed on the facts of the case,” said Sebi.